1. Take care of your year-end bookkeeping.You'll have an easier and probably less-expensive meeting with your tax pro if you've done your best to total up your income and expenses by category. Do this prior to your meeting. It usually doesn't matter to tax pros if people keep track of their records by hand or by entering information into their computer, although fewer and fewer small businesses try to do this without the help of a software program.If your tax preparation firm also handles your company's bookkeeping, then you'll want to be sure that you've turned all your 2005 data over to the firm. Regardless of who handles the bookkeeping, there will probably be year-end adjustments that your tax pro will provide for such things as depreciation and amortization.

2. Gather your annual information forms.You should get annual statements by the beginning of February about interest received on bank accounts and interest paid on business loans in 2005.Also, brokerages are required to send out year-end forms by January 31 that summarize interest, dividends, mutual fund capital gains and asset sales.

3. Line up your subcontractor information.There's nothing wrong with having independent subcontractors providing services for you during the year. But you will have to give a Form 1099-MISC to each subcontractor that received $600 or more in payments from you in 2005. There's a potential penalty of $50 for each failure to send a Form 1099-MISC.You'll also have to send the government a Form 1096, which summarizes the Form 1099 information. Form 1099 has to be sent to contractors by January 31. Note: You don't have to send a 1099 to any contractors that are corporations.

4. Consider how you want to deduct asset purchases.Most small businesses can elect to "write off" the full cost of most of their purchased assets such as furniture, computers and office equipment. Alternatively, they can choose to depreciate the assets over a number of years or to even combine the two options.Your best strategy will depend at least in part on how much money the business made in 2005; whether it is a C Corp., S Corp. or other entity; and what tax bracket you are personally in as an owner or shareholder of the business. For example, owners who anticipate being in a higher tax bracket in 2006 than in 2005 may choose to depreciate assets rather than write them off in 2005, so they'll have more deductions to take against their higher 2006 income.Fortunately, decisions about whether and how to treat assets for tax purposes can be made up until your tax returns are completed. You can talk with your tax pro about what tactics make the best overall sense for you, and have him or her run projections and scenarios given different circumstances.

5. Get your "s" status resolved.To be treated as a Subchapter S Corporation, businesses have to file a Form 2553 with the Internal Revenue Service requesting S-Corp. treatment. Ordinarily, that form needs to be filed before or by the 15th day of the third month of the corporation's tax year. (That would mean filing the form by March 15, 2005, for example, for a business that wanted S Corp. treatment beginning January 1 of last year.)However, there is a potential exception for you if you are a new corporation that wanted S Corp. treatment but neglected to file Form 2553 last year. With IRS Revenue Procedure 2003-43, a new corporation may be able to file Form 2553 in 2006 and still get S Corp. treatment for 2005.The rules for being allowed to make the late S Corp. election are complicated. But in general, a corporation will be eligible for this if there is reasonable cause for not having filed the form earlier, all the corporate shareholders have reported income consistent with being shareholders of an S Corp. and you haven't yet filed a corporate tax return — and made the request for late S Election no later than six months after the due date of the tax return. Other exceptions may also apply.As with most complex tax issues, it'll make sense to consult with your tax pro about this for specific advice and guidance.